Chennai: As a second-year student of mechanical engineering in Velammal College of Engineering, Santhosh Palavesh and seven other friends made short films on the handycam in 2007 as a hobby. The films received praise from those who saw them, and the hobby turned into serious fun when the team began to enter every competition and won every single one.

And, before they knew it, they began making visual effects for ad films and Tamil movies, all the while learning the tricks of the trade from the Internet—right from how to mix sound to animation.

UMM Studios provides various creative services such as design, branding, ad films, corporate films, visual effects and animation. UMM also has a technology division which looks into web designing, web hosting, and even software solutions.

For Palavesh, the owner of the ₹ 48 lakh company, the turning point came in his final year of engineering, when the talk all around college was to decide whether it would be an MS, an MBA or a job.

“I was a good student, and I had been placed in Caterpillar for a package of ₹ 7.5 lakh; but I knew what I wanted," recounts Palavesh. Having just received ₹ 75,000 for an ad film they made, the choice was clear for him.

UMM studio was incorporated in 2010. But sadly, from the eight-member team it was initially, only five stuck together. Luckily for Palavesh, he had the support of his father and mother, who encouraged him. The team began by targeting the small and medium companies whose budgets were small and were looking for good work.

Palavesh began UMM with an initial capital of ₹ 80,000, which it earned through ad films, and set up an office by renting a 350 sq. ft space in his own house.

He even paid his mother a rent of ₹ 3,500 for it.

“She wanted me to be serious about the business, and that’s why she demanded rent," he says.

By spreading the word, and building a contact base, soon the team went about acquiring order after order.

“The reason why we were able to win over clients is that people liked our fresh ideas, and also the fact that we were young and energetic," says Palavesh. He also believes his young age helped win people’s trust. “The CEOs I met would give me advice as to how I could do things better, and what mistakes I should avoid, which were very useful."

Being a first-generation entrepreneur, Palavesh learnt his business fundamentals by also being an active member of the National Entrepreneurship Network. “It was here that I saw young entrepreneurs talking about their ideas and experience. I was totally awestruck by it, and learnt to implement those ideas."

Palavesh and his team had the confidence that they could do just about anything in their domain. “Even if I didn’t know the job, we would say we know it and get the order, and then learn it, and give a quality job."

However, being a company with a team of students fresh from college, they executed their jobs by simply going after it one after another without any process or business model.

The lack of a process hurt the company as it encountered the problem of plenty.

There were too many orders, and too few employees.

This resulted in everyone doing whichever job was assigned to them.

“This was a wrong move as it resulted in a lot of time delay. Though the clients were understanding, we lost about four to five clients because we could not deliver the projects in time," says Palavesh.

He decided that the company will need to move towards specialization, and be more process driven. They also went on a recruitment drive and regularly added employees.

But finding the right team was also proving to be a big challenge. Two more team members of the five-member core team quit as they wanted a regular nine-to-five job and a regular salary, said Palavesh.

His solution to this problem of forming a right team was to recruit people based on their talent and not their resume.

“Some of the employees who work here are dropouts. But they are bubbling with ideas. I keep the resume aside while recruiting. We let them work for a day or two, and if we like their work, they have found a job. It’s as simple as that," says Palavesh.

Palavesh is also working on brushing up matters of finance. “We still haven’t grasped numbers too well. I let my father handle all matters related to finance," admits Palavesh, who is pursuing an MBA from Anna University through correspondence.

The company is also trying to shake off its low-cost image, as sometimes their services were 75% cheaper than the competition.

But being a cost-effective firm has resulted in orders flowing in from all directions and even from overseas. Palavesh plans to set up offices in the UK and Dubai by the end of next year.

He also plans to recruit some more management graduates for marketing and business plan development. To support growth, the company will also be adding five more employees by the end of next year.

The Chennai-based entrepreneur’s company has already received interest from venture capitalists. But Palavesh feels it would mean too much interference. He realizes his company is at a crucial stage now, but he says by thinking one step ahead, one can remain at the top of his game.

Mint is a strategic partner of National Entrepreneurship Network, which hosts the Tata First Dot competition.